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President addresses legislature in historic joint session

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The University of Hawaii for the 21st Century:
Putting the Power of Higher Education to Work for the State of Hawaii

President Hanabusa, Speaker Say, Governor Lingle, distinguished members of the Legislature, state Cabinet members and members of other government agencies, special guests from our education, labor, business and military communities, and to the people of Hawaii, good afternoon and aloha.

I wish to also extend greetings to our University of Hawaii guests, administrators and campus chancellors, faculty, staff and students, and now I would like to ask the members of the UH Board of Regents and our Emeriti Regents to stand and be recognized.

First, let me thank you, the Hawaii State Legislature, for affording me the privilege and honor of being the first University of Hawaii president to address a joint session of the Legislature. I sincerely appreciate this opportunity to share with you the accomplishments of the university and to reflect on our path ahead at this critical juncture.

I am grateful for the warm welcome I have received here in Hawaii, and for the wise counsel and guidance I have received from many of you here.

Thank you also for all that you have done to support the University of Hawaii, our mission and aspirations. Without your efforts, and the efforts of those before you, we would not be the strong and vibrant institution we are today.

I come before you today to focus our attention on what it means for this state to have a sole system of public higher education and the role of such an institution.

Indeed, education is the key to a better future for our society. For generations, this was the basis for what our society calls “the American dream.” Public higher education provides a critical foundation in our rapidly changing global environment.

The best universities provide the infrastructure and the environment to inspire collaboration both within and outside their institutional boundaries.

Creative knowledge generation is a contact sport, and while much is now virtual, the spirit of debate and discovery changes lives and worlds.

Great universities stimulate innovation and transform markets. For example, while a faculty member at UH Manoa, Dr. Norm Abramson pioneered a method of data packet transmission, still known globally as the Aloha protocol, which was essential in creating the modern Internet. Another UH Manoa researcher, Dr. Dorsey Stuart, a former research dean at the John A. Burns School of Medicine, developed a technology, along with his graduate research associate, that forms the basis for the Digene HPV test—the only test for the human papillomavirus accepted in the United States and Europe—that was essential to the company’s recent sale for $1.6 billion. This test allows doctors to save hundreds, if not thousands of women’s lives.

These ideas, and others like them, started in universities around the world, have spawned great industries and reshaped our economy. Individuals, businesses, state and federal government gained wealth, and the work of large segments of the market was revolutionized.

More than half of college students are women

On the other hand, sometimes out of universities come ideas that at the time may be dismissed as too academic. One of those “radical” ideas was that women were as smart as men and could do the jobs just as well as men.

When I graduated from college, fewer than 5 percent of medical school students were women; vet schools and law schools had even less. Today, my granddaughter and all young women make up more than 50 percent of students in these bastions of higher education. Those who persisted in this notion that women should be treated equally prevailed. While I could argue that we still have a way to go with equal pay for equal work, I again point out that this “theory” of equality was rooted and has matured in our universities, permanently changing society.

Another “academic” concept introduced even earlier was that access to education and a better future should be possible for the general population—not just the well off. Thus, land grant institutions, such as UH, emerged to teach a broader spectrum of the population not only the great books and languages of Western civilization, but also the agricultural and mechanical arts. The idea that public, state-based universities should directly aid businesses is not new. It started when land grant universities were established with a mandate to work directly with farmers and other evolving industrial business sectors. It advanced with the founding of the uniquely American community colleges with open doors and low tuition that ensured anyone with the desire could attain post-secondary education and training. Subsequently, many institutions were further shaped by public policies, such as the federal GI bill and Title IX, the groundbreaking legislation resulting from the work of Hawaii’s own Patsy Mink.

Alumna Ann Dunham pioneered microfinance

As we advance the nation’s international goals, we also look to education as a tool to advance democracy. In the future, all great universities will be global universities. UH already is. Secretary of State Hillary Clinton acknowledged this in her recent speech here at the East-West Center. She cited the transformative influence of a University of Hawaii alumna who spent years working on rural development, micro-finance and women’s welfare. She recognized that educating women in particular could revolutionize how money and power are distributed and provide a ladder to success for those to come. Her ideas did not make her personally wealthy, but they changed many lives for the better. This alumna was none other than Ann Dunham, the mother of President Barack Obama.

What do these examples demonstrate?

They demonstrate that you cannot put a price on the value of innovative ideas; you cannot command that great ideas appear; you cannot quantify what it means to have a well-educated public. However, states can make it easier for universities to adapt in order to accomplish these aims.

They demonstrate that we should appreciate what makes public universities great, and realize what our world might be without them. We should appreciate and honor the numerous individuals who make public universities what they are—faculty, students, administrators, staff and alumni who are our greatest and most valuable assets, enduring and resilient.

So, while I talk today about the important role UH plays and the significant return on your investment it provides, especially in the midst of this recession, I urge you to think of these individuals and all those who have directly helped UH in our recently completed Centennial Campaign. This campaign attracted 90,000 donors—50,000 of them new—and raised $336 million largely for students and faculty. Would the members of the UH Foundation Board, present and past, please stand?

This legislature itself is a perfect example. Nearly 70 percent of members are UH alumni. And, I should also point out that all four of our congressional delegates are UH alums. Would all the members of the legislature who attended or are alums of UH please stand? And now would all UH alumni please stand?

Medical student masters surgical techniques

Nearly two-thirds of all jobs in the country need some postsecondary education, and it is estimated that by 2015, 44 percent of Hawaii’s jobs will require some form of education and/or training beyond high school, with many jobs requiring a baccalaureate degree or higher. Of course, all will require periodic retraining and continuing education. Returning to a learning environment over the span of one’s working life is the norm, and it will become more so as we prepare for the economic necessities that come with improved life spans and productivity.

Our competitor economies understand this and several have been steadily increasing resources so their citizens have access to advanced education, putting them ahead especially in science and technology fields.

The level of degree attainment in leading developed nations—including Canada, Japan, and Korea—is rapidly increasing. Their younger populations are significantly better educated than their older populations. Unfortunately this is no longer true in the United States, including Hawaii. We must change this.

Hawaii has a unique integrated system of public higher education unlike any other state. This is an extraordinary asset that we must tailor to the 21st century. Let me underscore the advantages of our unique system with a few student examples.

Malia Davidson dropped out of college then returned after having children. She finished at Maui Community College, then obtained a UH Manoa bachelor’s degree through the University of Hawaii Center—Maui. Her struggles were immense. For example, her son passed away a few months before her graduation. Nevertheless, she commuted from Maui to Oahu, earning a master’s degree from UH Manoa. Malia says, “It is the aloha at UH that perpetuates a sense of belonging, the ability to move ahead and look back regardless of the challenge, to understand one’s kuleana in the grand picture of life.” Today, Malia Davidson is the statewide director for the Liko Ae Native Hawaiian Scholarship Program based out of Maui Community College. This program disburses approximately $1 million a year to serve Native Hawaiians with scholarship support.

Sarah Naeole earned a degree on Molokai

Sarah Naeole, a student on Molokai, never had to leave her island to pursue higher education. As a mother of three with a full time job, she was in no position to relocate her family and move away from the very community in which she wished to apply her education. Through our Molokai Education Center, she earned her associate degree. Inspired by the positive experience she had with the distance-education courses there, she moved on to a bachelor’s degree distance-education program through UH West Oahu. Sarah is now director of administration and compliance at the Bay Clinic in Hilo.

Dane Runsewe, president of the Student Congress at Kapiolani Community College, lived in dozens of different foster homes, group homes, shelters, rehab centers, and hospitals across the mainland and Hawaii. On his own in Hawaii, Dane attended night school at McKinley High School to get his high school diploma, and is financing his way through Kapiolani Community College with scholarships, financial aid and work.

He says, “I am only a success because of my education thus far. With an associate degree from KCC, the doors are all open for me. I hope I can continue to make the University of Hawaii System proud.”

Three times a week, students from the UH John A. Burns School of Medicine’s Homeless Outreach and Medical Education Project load up their van and head out to provide free medical care at Oahu shelters. On holidays, special events are planned to ensure that homeless children enjoy festivities, and they are not excluded from conversations at school about how they celebrated Halloween and Christmas. Medical student volunteers run and manage clinics at shelters in Kakaako, Waianae and Kalaeloa.

These stories vividly illustrate that higher education does have the power to change the trajectory of a life. They also show that our students and campuses give back to the community in service.

I’ve been privileged to have made my career as an educator and researcher, and to have served five institutions. I care passionately about higher education, as it transformed my own life. I would not be here today if it had not been for supportive friends, talented faculty, and most importantly, for the kindness of anonymous benefactors that helped me finance my undergraduate career. If it had not been for a state regents scholarship program and a forward looking National Defense Education Act loan forgiveness program, it is not likely that I could have gone on to graduate school. If it had not been for federal, state and foundation competitive research funding, I would never have been eligible for the great honor of serving this university and the state.

The concept that public education benefits the entire state and not just the individual student today is more important than ever. History has taught us that when new groups of students enter the innovation space, new concepts and products emerge. We must ensure that this generation has every opportunity to reach their aspirations. Without them, we will all see a diminished quality of life here in Hawaii.

Let’s talk about where we are today.

Both the university and the state have had to make very difficult choices in this troubled economy. We needed to adjust very rapidly, and as we stabilize, we must also move forward wisely, but confidently.

Those of us within the University of Hawaii know that we must continue to earn the public’s confidence as the sole provider of public higher education in Hawaii, and one way to do this is by demonstrating a responsible management of resources entrusted to us by the state. We have worked hard to leverage our unique capabilities as a system and become more efficient administratively. For example:

UH implemented the first electronic procurement and purchasing card systems in the state, as well as online systems for most human resources processing, student employment and streamlined inventory management.

UH implemented a new integrated statewide student information system that replaced 10 separate older systems, and we are now implementing new open-source systems for financial management and research administration.

UH has deployed statewide interactive video, and now open-source, web-based learning technologies, to provide Hawaii with a remarkable capability for broad and cost-effective access to higher education on all islands. In addition, use of online learning technologies is allowing us to accommodate our burgeoning enrollment without a proportionate increase in classrooms.

Hilo’s Student Life Center meets LEED standards

In addition, all of our campuses have initiated sustainability and energy reduction programs.

These initiatives have saved millions of dollars and produced greater efficiencies, transparency and accountability.

We all know what is at stake, so I would like to focus more on what we are doing for ourselves and what we must further do together to ensure that the University of Hawaii will be here to serve the state and its citizens for another 100 years and beyond.

An important way that we have been proactive rather than reactive is in our strategic planning. The University of Hawaii has been engaged for a number of years in a serious systematic assessment of our institution’s strengths and weaknesses—academic, organizational and operational, and the needs of the state. We have developed a strong strategic plan that clarifies and articulates our priorities, and ensures that they are in the state’s best interest as we collectively plan our preferred future. We are finding new ways to manage costs and to secure additional and diverse revenue streams to get us there. And, we measure our progress.

We are focusing our attention on three broad strategic objectives that will serve the state well into the future. They are:

Increasing the number of educated citizens in the state of Hawaii;

Contributing to the workforce and the economy; and

Advancing the University of Hawaii’s reputation for excellence and its ability to build the state’s capacity.

First, increasing the number of educated citizens.

President Obama has asked Congress to create the American Graduation Initiative to help bring the United States back to being a world leader in the number of citizens with higher education.

Today, I announce that we will create the Hawaii Graduation Initiative to increase the number of college graduates by 25 percent by the year 2015. The Hawaii Graduation Initiative will focus on access, affordability, and student success. Simply put, we want more local students to attend and graduate from UH.

Our goal is to remove barriers that prevent Hawaii residents from getting the higher education they desire and the graduates the state needs. One of the great strengths of the University of Hawaii is that we are an integrated system of higher education. We will do even more to capitalize on the synergy of our 10-campus system.

Be assured, the University of Hawaii is committed to increasing Hawaii’s “educational capital” by increasing the participation and success of students, particularly Native Hawaiian, lower-income students, and those from underserved regions.

Hawaiian studies students at commencement

We are committed to supporting the access and success of Native Hawaiians. We are making headway and we are fortunate to have partners along this path. For example, the community colleges through the Achieving the Dream initiative and with support from OHA and Kamehameha Schools have increased Native Hawaiian student enrollment by over 50 percent and are working to ensure these students succeed.

Increasing our educational capital also means helping students to overcome affordability barriers to higher education. We have made great strides in helping our students receive the aid they are eligible for and we have quadrupled our financial aid reserves for Hawaii residents. This year, more than 13,000 students were awarded the Federal Pell Grant, far exceeding our 2009 goal of increasing Pell grant recipients. With the dedicated work of our staff, we have awarded nearly $50 million in financial assistance to our students this year.

Increasing our educational capital means strengthening the pipeline every step of the way. It means that it is necessary to increase the college going rates from public and private high schools, which we are doing. A good example, and one of Hawaii P-20’s many initiatives, is Step Up, a campaign to raise awareness about the importance of a rigorous high school curriculum for students who hope to succeed in college, in careers, and as citizens in the 21st century. Step Up is a partnership among the UH, DOE, Hawaii P-20, businesses and community organizations.

I had a chance to meet Joshua Labajo, a freshman at Waialua High School where he is already taking geometry and honors classes in preparation for college. Joshua hopes to major in electrical engineering, and along with his classmates, is now encouraging other high school freshmen to sign a Step Up pledge.

We will continue our work with the Hawaii DOE to better prepare students to enter and succeed in college.

We will work through Hawaii P-20 to create an electronic portal so that intermediate and high school students and their parents can see what classes they need to take to enroll at our colleges, can apply automatically, and learn about financial assistance.

Hawaii Community College welding student

We will also create dual enrollment tracks in technical fields so that students can move smoothly from the DOE into technical programs within the community colleges.

We will launch a spectacular private partner pilot initiative thanks to the generosity of a wonderfully insightful friend of our state, Mr. Jim Lally. Our new scholarship program has been initiated at Kauai Community College. It targets students who otherwise could not go to college and helps them go to our Kauai campus. Then, it guarantees that they will continue to receive support through their bachelor’s degree as they succeed.

The University of Hawaii’s second strategic objective is to continue to contribute positively to the workforce and the economy.

As has been true in times past, difficult economic conditions tend to drive up college enrollments. This year, we enrolled the largest number of students in the history of the University of Hawaii—58,000 students.

Many of these students are entering the fields in which the state still has a critical workforce shortage, including teaching, nursing, computing, engineering, social work and hospitality. We are addressing these shortages and attracting additional private support to do so.

In this 21st century, there will be new types of jobs. It is already the norm that people will have five to seven jobs or careers in a lifetime, and they will need education to transition from one career to the next.

At the University of Hawaii, we create opportunities for adults returning to school. No longer is the average age of the college-going population 18 to 20 years. At West Oahu, the average student age is now 30. We must be prepared to address the educational and training needs of adults who are entering college for the first time, who are returning to complete their education after some years, and who are seeking a fresh start through retraining.

UH stands well ahead of many other universities in terms of our coordination and efficiency as one system. We have excellent systemwide academic collaboration, and expanding online programs that serve both new and returning students.

But we do much more. UH adds money, jobs and talented people to the state’s economy. We accomplish this by:

Increasing external research and training funding—which directly creates jobs and brings money into our state—over $414 million this past year;

Addressing research needs specific to state and region;

Enabling a quick response to business and industry training need;

Promoting “spin-offs,” licenses, and invention disclosures;

And finally, for every dollar the state spends, we leverage at least an additional $5.34 of spending in the state.

UH discoveries yield commercial potential

But there is always room for improvement.

While we have successful examples of technology transfer, I believe we can do even more. Today we need an approach that incorporates innovation as well as technology transfer. We must help new businesses emerge and older ones innovate. We must manage, not control, technology transfer for the good of the state. Our federal research and training enterprise has quadrupled in the past decade, and we must stay ahead of this curve.

Therefore, within the next 60 days, I will appoint a Presidential Advisory Group of Experts to study our successes, our challenges and our opportunities, with an eye toward understanding how the best universities achieve their impact. I will ask the group to advise us on the steps the university should take to create a 21st century capability for innovation and technology transfer, to support a multi-billion dollar industry for Hawaii in research, spin-offs and related services.

The university’s third broad objective, one that will have far-reaching impact, is to advance the University of Hawaii’s national reputation for excellence and its ability to build the state’s capacity.

The state of Hawaii needs and deserves a 21st century public university, one with superior facilities to attract and retain the best faculty for high quality teaching and research, and one with educational and administrative processes that deliver services efficiently and effectively. Your help with our new cancer center helps us gain a new facility and advances cancer care in the state, and your support to advance the next great telescope, the TMT, will bring in at least a billion dollars to our state.

But we have a very big problem. Decades of inadequate investment in our facilities are hindering the University of Hawaii in this regard. This limits what our faculty and students can achieve, reduces federal investment in our institution, and as the Gartley Hall situation demonstrates, even threatens the health and safety of our students, faculty and staff. This must change.

Infrastructure improvements also have a bearing on the university’s ability to recover costs to maintain support for extramurally funded research. As I reported to the House Finance Committee recently, federal indirect cost rates (earned overhead) are negotiated, and the UH rate of 36.7 percent is very low. For comparison, the University of Washington’s rate is 58 percent. Many factors influence indirect cost rates, but the level of investment in facilities is a major component. Thus, the poor condition of our facilities, particularly at Manoa, has a far-reaching effect on our ability to leverage external funds, add to the economy, create jobs and produce the research and student opportunities we expect of a 21st century university.

Let me also point out that monies spent on repairs, maintenance and construction are a triple bottom line. They lead directly to jobs for Hawaii’s construction workers. They provide the support to allow our faculty and staff to compete for additional funding, and they allow us to help ourselves for the future by better leveraging the external funds that we are awarded for research and training.

No other state investment will have so many immediate benefits while paving the way for long term growth of research, education and training.

UH’s first permanent building undergoes renovation

In short, we must renovate to innovate. We must energize and optimize our workforce, and this is one investment we can monitor, enhance and see as a lasting legacy.

Today, we announce Project Renovate to Innovate.

Our goals are to rebuild infrastructure, bring indirect cost rates in line with peer institutions, and increase creation of small businesses based on UH technology developments.

The university has achieved truly extraordinary growth in extramural funding, earning more than $400 million in contracts and grants for research and training last fiscal year and more than $270 million in the first half of this year alone. If the current rate of growth can be sustained for the remainder of the decade, it would yield the state a billion dollars in 2020.

Make no mistake that we will need additional funding in the future to achieve growth and support the faculty and staff who make all this possible. But we know the challenges you face this session, and that’s why our operating budget request is modest and we have focused on general obligation bond support for shovel-ready capital renovations and improvements. Our immediate goals are to improve our campus environments for students, enhance our volume of federal and private support, and spur job creation to help stimulate the local economy.

We believe that providing general obligation bond support right now is so important that we wish to “think outside of the box” and look to a new emergency partnership with the State of Hawaii. We do not have the revenue streams to support revenue bonds in this recession, but if it will aid in securing a GO bond, the university will stretch our limited resources and pledge to pay a share of the interest on a GO bond for a period of 5-7 years in order to get these jobs on the street as fast as possible and begin the process of renovating and building to insure that we can innovate and optimize.

In addition, we urge you to give us the flexibility we need to operate efficiently and effectively as a 21st century knowledge-based institution, which will allow us to focus our limited resources on education, research and service. We will accept this greater flexibility with a commitment to responsibility and full accountability.

In conclusion, our message is clear. UH is an investment that yields superior returns in both financial and human capital. We are a state that in the past had the foresight to build this unique system of 10 campuses and additional centers working together throughout our islands and communities.

UH is vital to a bright future for Hawaii

It took a century of hard work to enable the UH System to serve so many citizens of our ohana. We have educated the diverse groups that have come to call Hawaii home. We have embraced, and are strengthening, our unique responsibility to the indigenous people of Hawaii, the Native Hawaiians. We need to be sure we can pass this centennial legacy on. We need a new partnership with the state, a vibrant partnership that will lead to a preferred future, a future that so many in Hawaii are looking for. With your help, we can help ourselves meet this challenge and be the innovative, forward-looking university Hawaii so richly deserves.